{"id":18501,"date":"2013-09-17T22:31:00","date_gmt":"2013-09-18T05:31:00","guid":{"rendered":"http:\/\/drduru.com\/onetwentytwo\/?p=18501"},"modified":"2013-09-17T22:31:00","modified_gmt":"2013-09-18T05:31:00","slug":"accumulate-gold","status":"publish","type":"post","link":"https:\/\/drduru.com\/onetwentytwo\/2013\/09\/17\/accumulate-gold\/","title":{"rendered":"Ignore the Noise And Continue Accumulating Gold"},"content":{"rendered":"

(This is an excerpt from an article I originally published on Seeking Alpha on July 1, 2013. Click here to read the entire piece<\/a>.)<\/strong><\/p>\n

One of the scenarios I did not consider in my longstanding bullishness on gold is that the bond market might actually rise up AGAINST the wishes of the Federal Reserve. If the Fed actually loses control of the bond market, and increasingly this seems to be the case, I expect gold (GLD) to continue to lose its luster as the psychology of deflation transitions into an assumption that higher yields are finally on their way to pricing in future inflation (or inflation risks).<\/p>\n


\n
\"The<\/a>
The recent surge in yields now appears to be part of an extended bottoming process<\/figcaption><\/figure>
\nSource: The St. Louis Federal Reserve<\/a><\/strong>
\n
\n
\"TLT<\/a>
TLT gets slammed – trading at levels last seen in September, 2011<\/figcaption><\/figure>
\nSource: FreeStockCharts.com<\/a><\/strong>
\n<\/center><\/p>\n

{snip}<\/p>\n

Through all the blustering hype about bond tapering, Federal Reserve Chairman Ben Bernanke made clear in his last statements on monetary policy that the Fed still has the same rules for tightening policy it established back in 2011, and it has no intention of tightening policy anytime soon<\/a>. The current economic recovery is not strong enough to warrant a tightening in policy. In fact, the Fed wants to keep monetary policy loose for some time even after a recovery appears to finally be firmly in place. {snip}<\/p>\n

Fundamentally, I believe what has happened is much more a change in market psychology and sentiment than a real change in policy or economic growth. The likely implications of this change in psychology are tremendous for gold (and silver). {snip}<\/p>\n

Having this singular focus means I am more pragmatic than dogmatic about my bullishness on gold. {snip}<\/p>\n

We gold investors have had it relatively easy for many years now. Gold haters constantly called tops with every rally, and we would scoff and take great comfort in the next resumption of the rally. The broken clocks finally got it right in 2011 as gold made a “mini”-parabolic move to what now stands as a lasting high. {snip}<\/p>\n


\n
\"A<\/a>
A major breakdown for gold<\/figcaption><\/figure>
\n
\n
\"A<\/a>
A cascade of breakdowns<\/figcaption><\/figure>
\nSource: FreeStockCharts.com<\/a><\/strong>
\n<\/center><\/p>\n

{snip}<\/p>\n


\n
\"The<\/a>
The quarterly view shows the dollar index’s historic low ahead of the crisis and the trading range since then<\/figcaption><\/figure><\/p>\n

\"The<\/a>
The dollar index has been bouncing in a tight trading range since 2012<\/figcaption><\/figure>
\nSource: FreeStockCharts.com<\/a><\/strong>
\n<\/center><\/p>\n

I particularly like the long-term view of the dollar index. {snip}<\/p>\n

Another interesting characteristic of gold’s gyrations is the consistent ability of Google trends to signal major buying moments. {snip}<\/p>\n


\n
\"Spikes<\/a>
Spikes of interest in buying gold have come in the wake of major sell-offs and major bounces<\/figcaption><\/figure>
\nSource: Google Trends<\/a><\/strong>
\n<\/center><\/p>\n

{snip}<\/p>\n


\n
\"A<\/a>
A history of surges in buying and selling interest in gold<\/figcaption><\/figure>
\nSource: Google Trends<\/a><\/strong>
\n<\/center><\/p>\n

{snip}<\/p>\n

Click for a larger image…
\n


\n
\"Gold<\/a>
Gold Enthusiasm Spikes Again<\/figcaption><\/figure>
\n<\/center><\/p>\n

{snip}<\/p>\n


\n
\"...despite<\/a>
…despite the recent change in fortunes<\/figcaption><\/figure><\/p>\n

\"The<\/a>
The S&P 500 remains at major lows versus gold…<\/figcaption><\/figure>
\nSource for gold prices: World Gold Council<\/a>; source for S&P 500 and GLD prices: Yahoo!Finance<\/a><\/strong>
\n<\/center><\/p>\n

{snip}<\/p>\n

Until then, be careful out there!<\/p>\n

(This is an excerpt from an article I originally published on Seeking Alpha on July 1, 2013. Click here to read the entire piece<\/a>.)<\/strong><\/p>\n

Full disclosure: long GLD<\/p>\n","protected":false},"excerpt":{"rendered":"

(This is an excerpt from an article I originally published on Seeking Alpha on July 1, 2013. Click here to read the entire piece.) One of the scenarios I did not consider in my longstanding bullishness on gold is that the bond market might actually rise up AGAINST the wishes of the Federal Reserve. If … Read more<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[199],"tags":[200,24,25,354],"class_list":["post-18501","post","type-post","status-publish","format-standard","hentry","category-commodities","tag-gld","tag-gold","tag-silver","tag-slv"],"yoast_head":"\nIgnore the Noise And Continue Accumulating Gold - ONE-TWENTY TWO: Trading Financial Markets<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/drduru.com\/onetwentytwo\/2013\/09\/17\/accumulate-gold\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Ignore the Noise And Continue Accumulating Gold - ONE-TWENTY TWO: Trading Financial Markets\" \/>\n<meta property=\"og:description\" content=\"(This is an excerpt from an article I originally published on Seeking Alpha on July 1, 2013. 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